Two peaches kill three warriors, the operation experience of Hyperliquid

Author: Zuo Ye

On May 14, Native Markets announced the "sale" of $USDH to the CC combination of Circle and Coinbase, with a brief operation in August, NM directly took the money and left.

The CC combination not only aims to acquire $USDH but also to participate in $HYPE staking and share profits with the Hyperliquid ecosystem.

The Hyperliquid team successfully staged two instances of "playing a trick":

• First: Only granting legitimacy to $USDH, with NM responsible for issuance, reserves, and compliance.

• Second: Determining the attractiveness of AQA (standard quoted asset) for liquidity, with CC stepping in to take over a $5 billion existing business, making HL the only DEX profit-sharing channel for $USDC.

Liquidity within Liquidity

Returning to the starting point of the $USDH auction, why did Native Markets win? It seems suspicious now.

All of this can only be found in the thinking of the Hyperliquid team; NM is very likely just a tool.

It is quite strange that the quoted assets of Perp DEX must be synchronized with liquidity and will be deeply embedded in the entire ecosystem's underlying layer. The Hyperliquid official suddenly organizing the $USDH auction while already bridging and advancing the HyperEVM native deployment process for $USDC is very puzzling. If it was really just for $HYPE staking and profit-sharing, they could have negotiated with Circle.

Looking back, especially at the time point of July 2025, Circle's agreement to share profits with Bybit may be the starting point of all historical events. Before this, Circle had only had such cooperation agreements with Coinbase and Binance, especially since Coinbase even took away more than half of the $USDC issuance profits.

It is important to note that Coinbase's liquidity is far inferior to Binance's, and Circle's actions undoubtedly signed an "unequal treaty." In fact, in 2023, the CC combination did have a cooperation agreement:

• Circle obtained ownership of $USDC, while Coinbase retained only a portion of the equity;

• Coinbase received all interest from its platform's $USDC, plus 50% of the remaining $USDC interest.

This contract is for three years, automatically extending unless one party proposes to modify the terms.

Understanding this clause reveals Coinbase's significant influence over Circle. In the early days (2019-2020), USDC relied on Coinbase to survive in the shadow of USDT, at the cost of "giving up part of its soul."

In 2023, Circle prepared for an IPO and, in order to peacefully part ways with Coinbase, had no choice but to take this desperate measure, at least ending Coinbase's monopoly period, allowing USDC to truly move towards the on-chain and payment track.

🖼️ Image Description: USDC profit-sharing parties

🔗 Image Source: @zuoyeweb3

At that time, USDT occupied the vast majority of the on-chain transfer and exchange quoted asset market share. To enter the mature market, USDC paid a high price, such as a one-time payment of $60 million to Binance in 2024 for cooperation.

Coinbase could not take money for free; due to its own insufficient liquidity, to prevent USDC from being taken away by Binance, it facilitated the profit-sharing agreement between USDC and Bybit. The second-largest offshore exchange and the largest compliant exchange still tell the familiar story of six countries blocking the world's number one exchange.

To add, Paxos' USDG also collaborated with @krakenfx and @okx, and Ethena's USDe also signed cooperation agreements with CEX VCs.

Given this, the proactive market-making Hyperliquid announced the $USDH Ticker bidding in September 2025, cleverly using market pressure to prompt Circle and Coinbase to respond. Even if NM successfully bids, it does not gain any liquidity support; USDC still occupies the absolute mainstream in the HyperCore core quoted assets. But this is not important; the existence of USDH itself is a psychological pressure on the CC combination, which has been increasing with the outbreak of HIP-3.

Hyperliquid treats liquidity as a weapon, retreating to attract NM to join, and advancing to attract the CC combination to join with NM.

Legitimacy on Top of Legitimacy

After NM successfully bid for $USDH, the Hyperliquid team merely used "legitimacy" to exchange for $100 million in quoted assets and attract external stablecoins for $HYPE staking + liquidity deployment.

This is a coward's game; everyone knows that $USDC as a quoted asset is crucial for maintaining overall liquidity, but Hyperliquid is betting between liquidity "fragmentation" and the preferential strength of the CC combination.

Observing the conditions of the CC combination, they are quite candid: besides staking 500,000 $HYPE with @circle and @coinbase, they also promised to share over 90% of USDC interest with the Hyperliquid ecosystem (during the NM era, only 50% of the $HYPE quota was repurchased). This also reflects Coinbase's importance; Circle itself does not have the authority to decide such a high threshold fee, but the CC is betting on scale effects, especially to counter the trend of USDT spreading to on-chain.

On April 16, in Drift's self-rescue plan, the issuer of $USDT, Tether, provided a $100 million credit line to restore liquidity, but the condition was that Drift would switch to USDT as the quoted asset. This is not surprising; although USDT suppresses USDC in the CEX and payment fields, it has never given up on the opportunity to advance into on-chain DeFi.

In addition to the tacit understanding between Hyperliquid and the CC combination, the NM team's willingness to act as performers in this show is also intriguing. The most likely answer is: their interests are aligned with the $HYPE token, and they are not so bound to $USDH, ultimately staging a good show.

🖼️ Image Description: August fast track for $USDH

🔗 Image Source: @zuoyeweb3

Observing the founding resumes and main businesses of the NM team, you will find a very magical discovery: they seem not to have much relationship with Native Markets but have significant ties with various stakeholders around $HYPE.

Although MC Lader is the CEO, Max Fiege is often seen as the core figure, and the reason is not complicated: he has not only worked on the stablecoin Liquity but also has a close relationship with the $HYPE DAT company @hyperion_xyz. Coincidentally, he has served as a strategic advisor for Hyperion since June 2025, and only then initiated Native Markets to auction $USDH.

Looking at another co-founder, Anish Agnihotri, he has deep ties with early investors of $HYPE, @paradigm (he is one of Paradigm's youngest researchers), which can be understood as a representative of VC.

Although the Hyperliquid team did not vote in the $USDH auction, market makers like CMI Trading expressed their support for the NM team in advance, confirming that NM is indeed an "insider" of the Hyperliquid ecosystem.

Thus, $USDH operated as scheduled and ended as scheduled; it can even be understood that NM being acquired is more beneficial for them because Circle's profit-sharing repurchases $HYPE, which is an additional buying volume of $150 million annually.

Driven by the market, the Hyperliquid ecosystem nominated NM to win the bidding competition, but it should be noted that the legitimacy of USDH still comes from the Hyperliquid official, and the decision-making power of AQA (standard quoted asset) also lies with the Hyperliquid official.

AQAv2 was thus born, marking not only the end of $USDH's historical mission but also sealing the fate of $USDe and other QAs (quoted assets) in the unnoticed corners, relegating them to supporting roles in this round of the game. USDC will become the only "default quoted asset" in the entire @HyperliquidX ecosystem; other quoted assets may exist but will have no liquidity and no legitimacy.

In the ebb and flow:

• The Hyperliquid team gained profit-sharing and staking;

• The NM team profited and exited;

• The CC combination countered $USDT;

• Only the self-built quoted assets suffered in this world.

Conclusion

Proactive market-making has always been the essence of Hyperliquid.

But being able to navigate smoothly, riding the tide at every market node, achieving the greatest effect with minimal effort, is something every founder should learn frame by frame.

Moreover, the marketplace is like a battlefield; if one is not careful, they may end up like USDe, first treated as a runner, then as a tool, ultimately becoming marginalized.